We use cookies to customise content for your subscription and for analytics.If you continue to browse Lexology, we will assume that you are happy to receive all our cookies. For further information please read our Cookie Policy.

Among the tasks on the plate of the new Administration is the appointment of Commissioners to fill vacant slots at independent federal agencies. The vacancies are perhaps most pronounced at the agencies that oversee energy companies—the FERC, CFTC, SEC, and NRC. All four agencies are supposed to operate under the direction of five Commissioners. Yet, none of the four agencies is even close to operating with a full complement of Commissioners.

The past two years have seen the resignation (or announced resignation) of three SEC Commissioners, three FERC Commissioners, and three CFTC Commissioners. Unlike with a Cabinet agency, where the President can appoint an acting head, there is no process for selecting caretaker Commissioners. If a Commissioner resigns, a replacement must be formally nominated and confirmed by the Senate. Absent such an appointment, the position remains vacant.

In this case, none of the vacant slots at the four agencies has been filled. Consequently, the SEC is down to two Commissioners and the FERC and CFTC will be down to two Commissioners in the next two weeks. Although the NRC has seen fewer recent resignations, it also is functioning with just three Commissioners.

The vacancies are not just an inconvenience. The resignations have left the FERC without a quorum, meaning it cannot issue orders, approve settlements, or rule on pending complaints and petitions. The SEC, CFTC, and NRC are one resignation or one recusal away from being in a similar bind. Even when the agencies can still muster a quorum, the missing Commissioners impair the agencies’ operations and increase the burden on the remaining Commissioners.

It may be tempting to blame the shortage of Commissioners on Presidential inaction in nominating replacements or the Senate’s refusal to confirm nominees. To be sure, the short-staffing at the agencies is attributable in part to President Obama’s decision not to select replacements. For example, he did not nominate anyone to fill the two FERC vacancies that arose from resignations in late 2015 and 2016. By contrast, President Obama did nominate two persons last year to become SEC Commissioners, but opposition from some Senate Democrats evidently caused the nominations to sit idle until the new Administration took office. Yet, in almost all cases there would have been no need for Presidential appointments or Senate confirmations had the resigning Commissioners remained until the end of their terms.

Some may view the spate of Commissioner resignations as consistent with the tendency of Cabinet Secretaries to not serve for the entirety of a Presidential term. But this was not what Congress envisioned when it established the independent agencies. Congress structured the FERC, CFTC, SEC, and NRC to have five Commissioners serving staggered five-year terms. In theory, only one Commissioner should be appointed per agency per year. The goals of staggered terms are to (1) ensure continuity in the agencies’ operations; (2) maximize the collective institutional knowledge among the Commissioners; and (3) prevent a single Administration from dominating the appointment of the five Commissioners, thereby helping to ensure the agencies’ independence. Commissioners who elect not to serve their full terms frustrate all of those goals.

What is the solution? Perhaps the simplest is to ask candidates for Commissioner slots to commit, in writing, to serve a full term. Several commenters have suggested that Presidents extract such pledges from their political appointees, and such a pledge would be equally appropriate to demand of Commissioner candidates.

Some may question whether such a pledge would be legally enforceable. The answer probably is no, but some candidates may perceive a moral obligation to honor the pledge. Other candidates may fear a political cost if they break the pledge. Better yet, potential candidates who envision serving for a couple of years as a stepping stone to a bigger paycheck may decide not to apply, for fear that breaking a written pledge could damage their career prospects.

A related solution is for Presidents and Commissioners to disavow the tradition of the chairperson of the agency resigning upon a change in administration. While the incoming President should continue to have the statutory prerogative to name a new chairperson, particularly if the President and incumbent chairperson are from different political parties, there is no reason why the incumbent chairperson cannot recede to the role of a Commissioner and serve the remainder of his or her term. Stepping back may be unusual, but it is not unprecedented. Several CFTC Commissioners have reverted to being Commissioner after serving as Chairman, and recently Cheryl LaFleur has oscillated several times between being a Commissioner and Chairman of the FERC.

Demanding written pledges and discouraging resignations will not deter all Commissioners from quitting before the end of their terms. Some resignations may be unavoidable, such as in case of terminal illness. Yet, even a modest increase in the number of Commissioners who serve a full term would increase the efficiency of the agencies and avoid problems with maintaining a quorum.

Compare jurisdictions:Copyright

"Lexology is one of the few newsfeeds that I do actually look over as and when it comes in - the information is current; has good descriptive headings so I can see quickly what the articles relate to and is not too long."